What are some factors that underlie the economic benefits of swaps?
What will be an ideal response?
Answer: For swaps to provide economic benefits, they must allow the parties involved to engage in some form of arbitrage whether it is tax, regulatory or financial market arbitrage. The underlying benefits of swaps are the barriers that prevent other forms of arbitrage from functioning fully. This impediment must take the form of legal restrictions or limits on spot and forward foreign exchange transactions, different perceptions by investors of risk and creditworthiness of the two parties, appeal or acceptability of one borrower to a certain class of investor, and tax differentials. If the world's capital markets were efficient and full integrated, there would be little incentive to swap because arbitrage profit opportunities would disappear.
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Answer the following statements true (T) or false (F)
1. Media spin has very little impact on the public relations aspect of an organization. 2. Canadian media is concentrated, having only one or a few owners. 3. The concern that there may be too many voices in the media is referred to as an issue of centralization. 4. There is increasing fragmentation in the media. 5. There is an obvious increase in the coverage of ethical issues relating to business in today's media sources.
Which of the following describes the limitations of vendor-managed inventory that retailers may encounter?
A. It is an added cost with little benefit for the retailer. B. Since the vendor owns the merchandise until it is sold by the retailer, at which time the retailer pays for the merchandise, a retailer bears a financial risk. C. Retail buyers and planners need to monitor inventory levels. D. When the vendor coordinates the supply chain for its specific products, it does not know what other actions the retailer is taking that might affect the sales of its products in the future. E. It takes longer for a product to go from design to ordering the product to having the product on the selling floor.
The modified accelerated cost recovery system (MACRS):
A. Does not allow partial year depreciation. B. Is identical to units of production depreciation. C. Is required for financial reporting. D. Is included in the U.S. federal income tax rules for depreciating assets. E. Is an outdated system that is no longer used by companies.
Hill Co can further process Product O to produce Product P. Product O is currently selling for $60 per pound and costs $42 per pound to produce. Product P would sell for $82 per pound and would require an additional cost of $13 per pound to produce. The differential cost of producing Product P is $55 per pound
Indicate whether the statement is true or false